Save At Work To Make Securing Your Financial Future Easier
I’ve been told time and time again that saving at work is the easiest way to make sure you are securing your financial future. But as it turns out, that’s not always the case. I can tell you firsthand about when I first started my career and how quickly I learned it wasn’t always true in my case.
As a single guy with no dependents, no debt, and a solid job with good income, saving at work should have been child’s play. It should have all been downhill from there on out as far as insuring my financial future was concerned. However, as it turned out, I struggled mightily for many years with saving anything close to what I would have liked to.
I’ll tell you all about how I overcame that struggle in a moment. But first, let’s talk for a moment about why many people who should be doing well with saving at work are not saving nearly enough.
It starts with that whole “good income plus no dependents equals no problems” idea. That’s what I believed when I started my career. I thought I was living the dream. The only problem is that if you’re not careful, even a solid income can quickly turn into a less than stellar pay day.
Fortunately for me, it didn’t take very long to get a lesson in reality. It came in the form of an unexpected illness which lead to unexpected bills. Before I knew it, in what felt like no time at all, money saved at work in my 401k was gone and bills weren’t getting paid no matter how much overtime I put in.
That’s where it got interesting for me. That became the pivotal point in my journey. From there on out, I started learning a great deal about saving at work which I quickly discovered was more of an adventure than a cruise.
I’d like to share what I learned with you including the good, the bad, and the ugly. But don’t worry, it doesn’t all involve my first hand financial nightmares. The good news is that even though saving at work might not always be as easy as it sounds to some people, you can make it easy if you learn and apply some very useful tips and techniques.
Let’s get started with what can make saving at work harder than it needs to be.
One of the reasons people have a hard time saving at work is because they don’t plan for it. They don’t take a moment to ask themselves if they are saving enough. And if not, they don’t think about how to increase their savings rate. And that means they end up living paycheck to paycheck far more often than not. Sometimes even when there is more than enough money in the bank to cover everything each month, which can easily lead to financial catastrophe.
Oddly enough, one of the reasons I didn’t save as much as I should have is because I was too busy worrying about the bills. And I’m not talking about my bills. I worried about my parents’ bills. It turns out that even though there was more than enough money for me to cover all my expenses and then some, my parents were having a hard time with their monthly bills. And it quickly became a big issue for me.
As you can imagine, that meant they needed help covering the expenses – at least part of them. Which meant they were very grateful when their son paid some of their bills or helped cover them with money from his savings at work.
I’d be lying to you if I said I didn’t enjoy helping out. In fact, I was more than happy to do so. And since they were both in their late 70s at the time, they didn’t have a whole lot of extra income they could use to cover their expenses. They were both on fixed incomes and had no other real source of cash flow.
What happened next is what makes this story different from most others about saving at work and why it doesn’t always work out as well as it should for a lot of people. My parents helped me set up my 401k right after I started working. So they had a lot of years to build up a nice chunk of savings. And by that point, they were doing well with saving at work.
It also means I was doing well with saving at work. I had nothing to worry about as far as my own savings and retirement was concerned. And while I admit it might seem strange that having help paying my parents’ bills helped me save more than if I’d been responsible for paying them all myself, that’s exactly what happened. When I didn’t have to pay the bills, there was suddenly a lot more money available for me to save each month and things started going really well with saving at work once again.
All that being said, it was interesting to learn that so many people who should be doing well with saving at work are not. At least not as well as they should be in most cases. So how can you make sure you are doing well with saving at work? How can you turn what could be a struggle into a vacation instead?
The good news for anyone who is really worried about saving enough to get them through their retirement years is that there are some things you can do right away. Even during your first year or two on the job, following these tips will get you headed in the right direction almost immediately.
Make saving a part of your budget. This is probably the most important tip I can offer because it’s hard to save money you don’t have. And deciding how much of each paycheck to put into your 401k or retirement account each month shouldn’t be something you do at the last minute when you get paid. That’s how simple it should be for everyone with a proper plan for their savings. If you don’t have a plan, now is as good a time to start one as any if you want to make 2018 a great year for your savings at work.
Decide on an amount and stick to it. You might not know exactly how much you’ll need to save in order to meet your goals. But you can make a plan and decide how much of your paycheck you’ll put into your 401k or other retirement account each month. It’s also a good idea to decide on a goal for what percentage of your pay you should be saving.
If you have trouble with saving at work, it could be because you don’t have the right plan for doing so. For example, if it takes an act of Congress to get yourself to put any money into your 401k each month, it might be because you don’t think the amount you are putting in is enough.
Conclusion
I know saving at work might not always be as easy as it sounds. And I make no secret about how much I’ve struggled with it over the years myself. It wasn’t until after I left my job two and a half years ago that things began to look more positive for me financially. And while that means I’m paying a lot more in taxes now, it feels like a small price to pay for having all the financial freedom I have now.
But even though I had experiences like my first one when everything suddenly turned upside down, there are ways you can prepare for coming financial storms by learning some of what I learned from them and applying what you learn before they ever happen.